Ram-Alf Posted October 16, 2021 Share Posted October 16, 2021 3 minutes ago, alexxxxx said: I'd argue it is as well however I've gone on what Mr maguire was saying on his pod this week. Insurance companies have not been paying out on force majeure clauses. Interesting question about how much a chairman/shareholder should be expected to fund a club. Not too sure whether these are Force Majeure...but certainly Covid affected their closure and won their cases in the Supreme Court. https://www.theguardian.com/business/2021/jan/15/small-businesses-win-covid-insurance-payouts-after-uk-supreme-court-victory Link to comment Share on other sites More sharing options...
Abu Derby Posted October 16, 2021 Share Posted October 16, 2021 Rolls Royce used the force majeure clause to close their final salary pension fund citing the impact of COVID. Link to comment Share on other sites More sharing options...
Comrade 86 Posted October 16, 2021 Share Posted October 16, 2021 9 minutes ago, alexxxxx said: I'd argue it is as well however I've gone on what Mr maguire was saying on his pod this week. Insurance companies have not been paying out on force majeure clauses. https://www.theguardian.com/business/2021/jan/15/small-businesses-win-covid-insurance-payouts-after-uk-supreme-court-victory Link to comment Share on other sites More sharing options...
Ram-Alf Posted October 16, 2021 Share Posted October 16, 2021 3 minutes ago, Abu Derby said: Rolls Royce used the force majeure clause to close their final salary pension fund citing the impact of COVID. And moved half of their pension holders to Legal and General...of which I was one. Link to comment Share on other sites More sharing options...
PistoldPete Posted October 16, 2021 Share Posted October 16, 2021 (edited) 45 minutes ago, alexxxxx said: Trouble is for the efl, I don’t think ‘other clubs haven’t gone in to administration’ is relevant to understanding why Derby went in to administration. i suspect Derby won’t win the appeal, as the administrators might struggle to show that Derby’s finances were otherwise stable, particularly if the hmrc debt predates COVID. also there is the question about whether COVID actually is a force majeure event. Force Majeure is defined in the EFL Rules as follows: "For the purposes of this Regulation 12, a ‘Force Majeure’ event shall be an event that, having regard to all of the circumstances, was caused by and resulted directly from circumstances, other than normal business risks, over which the Club and/or Group Undertaking (as the case may be) could not reasonably be expected to have control and its Officials had used all due diligence to avoid the happening of that event" As I say there is no question that COVID fits that description. Oh and if you are listening to Maguire podcasts, he is an EFL stooge. Do not believe a word that he says. Edited October 16, 2021 by PistoldPete Reggie Greenwood, Indy, I know nuffin and 5 others 3 5 Link to comment Share on other sites More sharing options...
DarkFruitsRam7 Posted October 16, 2021 Share Posted October 16, 2021 2 hours ago, Leeds Ram said: Yeah, you're right i think on the committee but that generally breaks in favour of the government (even after the relatively recent reforms I believe). I think it's an interesting question on their power, the SC's decision was highly controversial partly because some saw it as overstepping their constitutional role. It's certainly been argued the reforms have set in motion a train that will lead to greater independence of the judiciary and challenging Parliament in areas that were previously unforseen. Not to stray into politics, but the Supreme Court 100% did their job correctly by ensuring Brexit motions went through Parliament. Reggie Greenwood, Indy and LazloW 2 1 Link to comment Share on other sites More sharing options...
LazloW Posted October 16, 2021 Share Posted October 16, 2021 4 hours ago, PistoldPete said: Force Majeure is defined in the EFL Rules as follows: "For the purposes of this Regulation 12, a ‘Force Majeure’ event shall be an event that, having regard to all of the circumstances, was caused by and resulted directly from circumstances, other than normal business risks, over which the Club and/or Group Undertaking (as the case may be) could not reasonably be expected to have control and its Officials had used all due diligence to avoid the happening of that event" As I say there is no question that COVID fits that description. Oh and if you are listening to Maguire podcasts, he is an EFL stooge. Do not believe a word that he says. I agree entirely that that paragraph would seem to apply to COVID and ought, in theory, to at least provide something of a reasonable argument. The last sentence is interesting though - I assume our argument on this is that DCFC obviously had no control over COVID, the Government's response or how it would affect the club's earnings. I wonder if the EFL will argue (not necessarily correctly in my book) that 'due diligence' would have been not being in such a precarious position already that we couldn't access loans etc in the same way as 'well run' clubs did (i.e. comes back to the 'nobody else has gone into administration because of COVID' argument... which is bullpoo to me). Link to comment Share on other sites More sharing options...
G STAR RAM Posted October 16, 2021 Share Posted October 16, 2021 5 hours ago, alexxxxx said: also there is the question about whether COVID actually is a force majeure event. If Covid does not meet definition of a force majeure event, then I am struggling to think of anything that will. It is literally the biggest event of a generation. Reggie Greenwood, MackworthRamIsGod and Comrade 86 1 2 Link to comment Share on other sites More sharing options...
Van der MoodHoover Posted October 16, 2021 Share Posted October 16, 2021 1 minute ago, G STAR RAM said: If Covid does not meet definition of a force majeure event, then I am struggling to think of anything that will. It is literally the biggest event of a generation. It will fit the definition, but our case will hinge on the bit about whether the club did everything they could to prepare... We will claim we have been reducing costs, no doubt the EFL will try to claim running up debts is not consistent with "doing all you can to prepare..." It'll be a bunch of technical arguments I suspect.... Link to comment Share on other sites More sharing options...
Stive Pesley Posted October 16, 2021 Share Posted October 16, 2021 5 hours ago, alexxxxx said: Insurance companies have not been paying out on force majeure clauses I for one, am shocked that insurance companies are trying to avoid paying out. Don't us poor policy holders understand that this is simply not the way insurance works? Shocked I tells you alexxxxx and Comrade 86 2 Link to comment Share on other sites More sharing options...
B4ev6is Posted October 16, 2021 Share Posted October 16, 2021 Well appentley someone paid off 81m loan for dcfc I wander who that can be. Link to comment Share on other sites More sharing options...
RandomAccessMemory Posted October 16, 2021 Share Posted October 16, 2021 20 minutes ago, Van der MoodHoover said: It will fit the definition, but our case will hinge on the bit about whether the club did everything they could to prepare... We will claim we have been reducing costs, no doubt the EFL will try to claim running up debts is not consistent with "doing all you can to prepare..." It'll be a bunch of technical arguments I suspect.... I thought the debts built up during Covid, because of it, not before? The MSD loan/s were certainly taken during Covid. The relevant charges are dated August and October 2020. I know the previous winding up order issued by HMRC in the January before Covid has been mentioned, but I can’t see why it would have been withdrawn so soon afterwards if they had not been paid, wouldn’t they have stuck with it? Link to comment Share on other sites More sharing options...
Van der MoodHoover Posted October 16, 2021 Share Posted October 16, 2021 23 minutes ago, Stive Pesley said: I for one, am shocked that insurance companies are trying to avoid paying out. Don't us poor policy holders understand that this is simply not the way insurance works? Shocked I tells you Well actually, insurance cannot and does not price catastrophic risks across a whole economy. Its very essence is the principles of averaging and redistribution around a mean. The whole thing breaks down completely in the scenario where the government effectively "switched off" the entire retail economy, so that there was no "averaging" and the aggregate claims would simply bankrupt the entire insurance sector. Link to comment Share on other sites More sharing options...
Van der MoodHoover Posted October 16, 2021 Share Posted October 16, 2021 3 minutes ago, RandomAccessMemory said: I thought the debts built up during Covid, because of it, not before? The MSD loan/s were certainly taken during Covid. The relevant charges are dated August and October 2020. I know the previous winding up order issued by HMRC in the January before Covid has been mentioned, but I can’t see why it would have been withdrawn so soon afterwards if they had not been paid, wouldn’t they have stuck with it? Mine was a more general point that we had been struggling to fit within P&S for a few years, which is an allowable loss of 13m per year I think. Making continuous losses when you have the revenue is not evidencing a resilient business model. More a hope and a prayer that nothing goes wrong. Link to comment Share on other sites More sharing options...
RandomAccessMemory Posted October 16, 2021 Share Posted October 16, 2021 24 minutes ago, Van der MoodHoover said: Mine was a more general point that we had been struggling to fit within P&S for a few years, which is an allowable loss of 13m per year I think. Making continuous losses when you have the revenue is not evidencing a resilient business model. More a hope and a prayer that nothing goes wrong. I think there’s only so much you can do to reduce costs when player contracts are watertight and they are the biggest cost. We’d done all we could on that score, let high paid players go as and when their contracts ran out, if we couldn’t agree a new contract within our new self-imposed limits. We also tried to get at least part of their wage off the books before that happened with loaning them out if we weren’t planning on trying to keep them. We sold when we got decent (not cheekily low) offers for players. Link to comment Share on other sites More sharing options...
PistoldPete Posted October 17, 2021 Share Posted October 17, 2021 2 hours ago, Van der MoodHoover said: It will fit the definition, but our case will hinge on the bit about whether the club did everything they could to prepare... We will claim we have been reducing costs, no doubt the EFL will try to claim running up debts is not consistent with "doing all you can to prepare..." It'll be a bunch of technical arguments I suspect.... The Force Majeure event is the COVID pandemic and resulting lockdown. There is nothing Derby could reasonably do to control either event. They were told by Government to not allow fans in or be prosecuted. Nor is the pandemic or lockdown a normal business risk . The pandemic is the worst in 100 years , and a national indeed global lockdown is the first in history. Hardly normal. Link to comment Share on other sites More sharing options...
Gaspode Posted October 17, 2021 Share Posted October 17, 2021 7 hours ago, Van der MoodHoover said: It will fit the definition, but our case will hinge on the bit about whether the club did everything they could to prepare... We will claim we have been reducing costs, no doubt the EFL will try to claim running up debts is not consistent with "doing all you can to prepare..." It'll be a bunch of technical arguments I suspect.... you can’t prepare for an unexpected event….. otherwise it wouldn’t be unexpected MackworthRamIsGod 1 Link to comment Share on other sites More sharing options...
Van der MoodHoover Posted October 17, 2021 Share Posted October 17, 2021 29 minutes ago, Gaspode said: you can’t prepare for an unexpected event….. otherwise it wouldn’t be unexpected You scenario test for possible future events, such as a sudden loss of revenue, and design mitigating plans to increase the resilience of your business. Risk management. San Fran Van Rams 1 Link to comment Share on other sites More sharing options...
G STAR RAM Posted October 17, 2021 Share Posted October 17, 2021 7 hours ago, RandomAccessMemory said: I thought the debts built up during Covid, because of it, not before? The MSD loan/s were certainly taken during Covid. The relevant charges are dated August and October 2020. I know the previous winding up order issued by HMRC in the January before Covid has been mentioned, but I can’t see why it would have been withdrawn so soon afterwards if they had not been paid, wouldn’t they have stuck with it? With the debts rumoured to be between £50m and £60m, I'm not sure how the can only have accumulated during Covid, with MM stating that it had cost us £20m in income. Link to comment Share on other sites More sharing options...
Oldben Posted October 17, 2021 Share Posted October 17, 2021 Why wigan appeal failed and why Derbys might succeed, from the trial decision ... “First, we are satisfied on the evidence we have seen that the Insolvency Event arose because Mr Kay, the effective owner, made a commercial decision to choose to go back on promises of continued support and stopped putting money into the Club. That cannot be regarded as a ‘Force Majeure’ event." "In circumstances in which it is by no means uncommon in football generally and in the Championship in particular for a Club to depend on external support from its ultimate owners to bridge the gap between income and expenditure (at least without disposing of assets such as the playing staff), it is, we consider, a normal business risk that an owner will lose interest or run out of money and/or choose to deploy its resources elsewhere. This is what happened here.” It was effectively argued that Wigan were only partially effected by the pandemic, especially given the short period of time over which the club was in the pandemic before making the appeal. In Derbys case the timeline is different. It would not in my opinion, be reasonable to claim that Derby were not financially supported throughout the longer period of the pandemic since Mel continued paying the wages and club debts. I can also clearly see that the pandemic caused lost revenue that contributed to the administration. Efl could claim there was not enough of an effect from Force Majeure. OK then the Efl have no legal right in my opinion to add Force Majeure to there legal document as they have zero intention of honouring that, where it can be seen as in Derbys case that Force Majeure was definately a contributing factor. On that basis I can't say that the efl would be respecting the clubs or fans of the efl. At the very least there contract with efl clubs on Force Majeure, could be seen to have been broken. There might even be a legitimate legal case that the efl do not operate in the interests of the clubs or fans. Link to comment Share on other sites More sharing options...
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